Reader makes suggestions for economy

GUEST EDITORIAL

When the big banks were failing in 2008, Fed Chief Ben Bernanke told President George W. Bush that if he didn't act quickly the consequences would be worse than the Great Depression. That led to Bush's unpopular 2008 TARP bailout which, along with President Obama's 2009 economic stimulus package, is credited with averting a complete economic collapse. There is plenty of pain from our high unemployment rate. It would be better if Obama's stimulus package was larger and entirely for job creation rather than partly for tax cuts required to get Republican votes. 

Pundits say the election showed voters want an austerity program (tax and spending cuts, minimal regulations), as advocated by Republicans. But following the beginning of the Great Depression, the Herbert Hoover administration initially adopted an austerity program and it failed, the unemployment rate spiking from 8.7 percent in 1930 to 24.9 percent in 1933. 

Franklin Roosevelt's administration rescued the economy by raising taxes, especially on the rich, and greatly increasing government spending on jobs creation programs. The top tax rate was raised from 25 to 63 percent in 1932, and to 79 percent in 1936. It was 91 percent in 1945, and stayed at least 88 percent until 1963 when it was lowered to 70 percent. The United States experienced the greatest economic boom. The top rate stayed at least 70 percent until drastically reduced during the Reagan Administration. 

Roosevelt's jobs creation programs included the Civilian Conservation Corps (CCC) and Work Projects Administration (WPA) that successfully worked on our country's infrastructure, a paramount need again today. President Obama in September asked Congress for $50 billion for a new infrastructure plan designed to expand and renew the nation's roads, railways and runways, but Republicans withheld the necessary votes.

Will we have to learn the same lessons again?